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Action

Proposed Rule.

Summary

EPA is proposing to approve state implementation plan (SIP) revisions submitted by the State of California on June 15, 2004 and February 3, 2009, relating to reformulated gasoline (RFG) and diesel fuel sold or supplied as motor vehicle fuels in California. The revisions relating to RFG include California Phase 3 RFG (CaRFG3) regulations, correction of errors and streamlined requirements for compliance with and enforcement of the CaRFG3 standards, and an update to the State's predictive model to mitigate permeation emissions associated with the use of ethanol as a fuel additive. The revisions relating to diesel fuel establish test methods for determining the aromatic hydrocarbon content in diesel fuel and lower the maximum allowable sulfur content for motor vehicle diesel fuel.

Instructions: All comments will be included in the public docket without change and may be made available online at http://www.regulations.gov, including any personal information provided, unless the comment includes Confidential Business Information (CBI) or other information whose disclosure is restricted by statute. Information that you consider CBI or otherwise protected should be clearly identified as such and should not be submitted through http://www.regulations.gov or e-mail. http://www.regulations.gov is an “anonymous access” system, and EPA will not know your identity or contact information unless you provide it in the body of your comment. If you send e-mail directly to EPA, your e-mail address will be automatically captured and included as part of the public comment. If EPA cannot read your comment due to technical difficulties and cannot contact you for clarification, EPA may not be able to consider your comment.

Docket: The index to the docket for this action is available electronically at http://www.regulations.gov and in hard copy at EPA Region IX, 75 Hawthorne Street, San Francisco, California. While all documents in the docket are listed in the index, some information may be publicly available only at the hard copy location (e.g., copyrighted material), and some may not be publicly available in either location (e.g., CBI). To inspect the hard copy materials, please schedule an appointment during normal business hours with the contact listed in the FOR FURTHER INFORMATION CONTACT section.

This table is not intended to be exhaustive, but rather provides a guide for readers regarding entities likely to be regulated by this proposed action. This table lists the types of entities that EPA is now aware could be potentially regulated by this action. Other types of entities not listed in the table could also be regulated. To determine whether an entity is regulated by this proposed action, one should carefully examine the RFG provisions at 40 CFR part 80. If you have questions regarding the applicability of this proposed action to a particular entity, consult the person listed in the preceding FOR FURTHER INFORMATION CONTACT section.

B. What Should I Consider as I Prepare My Comments for EPA?

1. Submitting CBI. Do not submit this information to EPA through EDOCKET, regulations.gov or e-mail. Clearly mark the part or all of the information that you claim to be CBI. For CBI information in a disk or CD-ROM that you mail to EPA, mark the outside of the disk or CD-ROM asCBI and then identify electronically within the disk or CD-ROM the specific information that is claimed as CBI). In addition to one complete version of the comment that includes information claimed as CBI, a copy of the comment that does not contain the information claimed as CBI must be submitted for inclusion in the public docket. Information so marked will not be disclosed except in accordance with procedures set forth in 40 CFR part 2.

vii. Explain your views as clearly as possible, avoiding the use of profanity or personal threats.

viii. Make sure to submit your comments by the comment period deadline identified.

II. California Reformulated Gasoline and California Diesel Fuel Programs Back to Top

A. What Is the SIP-Approved California Program for Reformulated Gasoline?

Gasoline sold in California is generally subject to federal standards promulgated by EPA pursuant to section 211(k) of the CAA.
[1]
The federal reformulated gasoline (RFG) program has had two phases. Phase I was effective from January 1, 1995 to December 31, 1999 and Phase II has been in effect since January 1, 2000. The Federal Phase II program is similar to the Phase I program but requires additional reductions in emissions of volatile organic compounds (VOCs), oxides of nitrogen (NO X) and toxic air pollutants. In addition to the Federal standards, gasoline sold in California is also subject to standards set by the California Air Resources Board (CARB).
[2]
The California RFG program consists of three phases. California RFG Phase 1 was replaced by the more stringent requirements of California RFG Phase 2 (CaRFG2), effective March 1, 1996. CARB further strengthened its standards when it promulgated the California RFG Phase 3 (CaRFG3) regulations on August 3, 2000.

In 1994, EPA adopted exemptions from certain enforcement provisions in the Federal RFG regulations for refiners, blenders and importers of gasoline sold for use in California and subject to CaRFG2.
[3]
These exemptions were based on a comparison of CaRFG2 with Federal RFG Phase I, and later Federal RFG Phase II gasoline, and were based on the following findings:

(1) The emissions reductions from the CaRFG2 standards would be equal to or greater than the applicable Federal standards;

(2) The benzene content of CaRFG2 would be equivalent in practice to the Federal standards (as well as the then-applicable oxygen content standard in Federal RFG areas); and

(3) CARB's compliance and enforcement program was designed to be sufficiently rigorous to ensure that Federal requirements would be fulfilled in practice.

We approved the California Phase 1 and Phase 2 regulation
[4]
into the SIP on August 21, 1995 (60 FR 43379).

B. What Is the SIP-Approved Program for California Diesel Fuel?

On October 1, 1993, both Federal
[5]
and California standards for diesel fuel took effect. These standards required reductions in sulfur particulate and NO X emissions from vehicles burning diesel fuel. While the programs were substantially similar, the California program set a more stringent standard for aromatic hydrocarbons than the Federal program. In addition, the California program applied to diesel fuel used in on-road applications, like the Federal program, but also for nonroad diesel vehicles like construction and farm equipment. We approved the California diesel fuel rules
[6]
on August 21, 1995 (60 FR 43379).

C. What Regulations Did the State Submit?

California Reformulated Gasoline

On June 15, 2004, the State submitted a series of amendments to the reformulated gasoline rules found in 13 CCR 2260-2272 as approved by EPA in 1995 and referenced in footnote 3. Specifically, on August 3, 2000, the State adopted amendments thatestablished the CaRFG3 standards and program, including revisions leading to the phase out of methyl tertiary-butyl ether (MTBE) as a gasoline oxygenate. Starting March 21, 2001, the State adopted a series of rulemakings to amend 13 CCR 2260-2272 regarding certain limits for denatured ethanol used in California gasoline and the model for “California reformulated blendstock for oxygenate blending” or “CARBOB.” These amendments also allowed certain small refiners to offset excess emissions from CaRFG3 with additional emission reductions from lowering the aromatic hydrocarbon content of diesel fuel. On May 1, 2003, the State adopted amendments to 13 CCR 2262.6 and 2263 that updated test methods used to comply with CaRFG3 regulations and also delayed the phase out of MTBE by one year to avoid disrupting the supply of gasoline in California.

On February 3, 2009, the State submitted revisions to the reformulated gasoline rules found in 13 CCR 2260, 2262, 2262.4, 2262.5, 2262.9, 2265 and 2266.5. These revisions were adopted by the State on November 18, 2004. Among other things, the revisions updated the procedure for evaluating alternative specifications for CaRFG3 using the California Predictive Model. Also, the State submitted new reformulated gasoline rules found in 13 CCR 2260(a)(0.5), (0.7), (6.9), (7.5), (8.5), (10.5), (10.7), (19.7), (19.8), (23.5), (23.7), (37), (38), 2262.3(d), 2264.2(a)(3), (b)(5), and (d), 2265(c)(4), 2265.1, 2265.5 and 2266(b)(3), (4), and (5); and revisions to the existing reformulated gasoline rules found in 13 CCR 2261, 2262, 2262.4, 2262.5, 2262.9, 2263, 2263.7, 2264.2, 2266, 2266.5, 2270, 2271 and 2273. These new rules and revisions were adopted by the State on August 7, 2008. Among other things these rules updated the California Predictive Model in the CaRFG3 regulations to mitigate permeation emissions associated with the use of ethanol as a fuel additive.

California Diesel Fuel

On February 3, 2009, the State submitted revisions to the diesel fuel rules found in 13 CCR 2281(c), 2282(b), 2282(c), and 2282(g). These revisions were adopted on June 4, 1997. Among other things, the revisions establish test methods for determining aromatic hydrocarbon content in diesel fuel. Because Sections 2281 and 2282 are incorporated by reference into the State's rules concerning exhaust and emission standards and test procedures, those rules
[7]
were amended to incorporate the new language as well. Also, the State submitted new diesel fuel rules found in 13 CCR 2284 and 2285 and amendments to the diesel fuel rules found in 13 CCR 2281 and 2282. Because these revisions pertain to rules that are incorporated by reference elsewhere, those rules were amended to reflect the new language in 13 CCR 2281 and 2282.
[8]
These rule changes, among other things, lowered the maximum allowable sulfur content for motor vehicle diesel fuel and were adopted by the State on July 15, 2004.

III. EPA Evaluation of California Reformulated Gasoline and California Diesel Fuel SIP Submittals Back to Top

A. What Requirements Apply to These SIP Submittals?

Generally, SIP rules must be enforceable. See CAA section 110(a). Monitoring, recordkeeping, reporting and associated requirements generally ensure that the submitted rule can be enforced. In addition, section 110(l) of the CAA provides that EPA shall not approve a SIP revision if it would interfere with any applicable requirement concerning attainment and reasonable further progress or any other applicable requirement of the Act.

Some of the SIP revisions submitted by the State are non-substantive editorial or format changes. Some substantive changes are considered minor. Major substantive changes are discussed below. A detailed analysis of all revisions can be found in the Technical Support Document that accompanies this proposed action.

B. Are These SIP Submittals Approvable?

The applicable Federal requirements for reformulated gasoline are found in section 211(k) of the CAA. Section 211(k) directs EPA to set requirements for Federal RFG in certain ozone nonattainment areas, as well as “anti-dumping” requirements for the rest of the nation. The current requirements for Federal RFG include reductions in ozone-forming VOCs, NO X, and toxic air pollutants from gasoline-powered motor vehicles. As stated above, the regulations for Federal RFG can be found at 40 CFR part 80, subparts D, E and F. In California, Federal RFG is required in the San Joaquin Valley, Los Angeles, San Diego and Sacramento.
[9]

On December 21, 2005, we exempted refiners, blenders and importers of CaRFG3 from certain enforcement provisions in the Federal RFG regulations found at 40 CFR 80.81.
[10]
In extending the enforcement exemption to CaRFG3, we made the following determinations: (1) That emission reductions from CaRFG3 would be equal to or greater than the emission reductions from Federal Phase II RFG standards; (2) that the content standard for benzene in CaFRG3 would be equivalent in practice to the Federal Phase II RFG standard and that the oxygen content standard of 2.0 weight percent would be met in Federal RFG areas;
[11]
and (3) that the CARB compliance and enforcement program is sufficiently rigorous to ensure that Federal Phase II RFG requirements would be met in practice.

CARB's compliance and enforcement program has not changed since we made the above finding regarding its adequacy.
[12]
Therefore we are proposing to approve as meeting the requirements of CAA section 110(a) the CaRFG3 regulations and subsequent amendments to those regulations, submitted to us on February 3, 2009, to correct errors, allow additional compliance options, and update recordkeeping requirements. Moreover, because the submitted SIP revisions strengthen the requirements in theapproved SIP, EPA has determined that approval of these regulations is consistent with CAA section 110(l).

California Diesel Fuel

As stated above, specific CAA requirements for reformulated diesel fuel are found in section 211(i) of the CAA. Additionally, EPA has promulgated diesel fuel regulations, known as the “Highway and Nonroad Diesel Rule,” pursuant to section 211(c) of the Act which improved fuel quality by lowering sulfur levels for onroad diesel fuel from 500 ppm to 15 ppm (“ultra-low sulfur diesel”), starting June 1, 2006.
[13]
This improvement allowed for the use of new technologies to reduce emissions from diesel engines.

Effective May 31, 2006, as part of technical amendments to its Highway and Nonroad Diesel Rule,
[14]
EPA exempted “California diesel fuel” from certain labeling, reporting and recordkeeping requirements.
[15]
The basis for this exemption was that California diesel was subject to requirements that equaled or exceeded the requirements for diesel fuel in the Highway and Nonroad Diesel Rule.

California regulations at 13 CCR 2281, proposed for approval in this action, impose a 15 ppm sulfur content standard in diesel fuel as of June 1, 2006 and this standard applies to diesel fuel used in intrastate locomotive and marine engines as of January 2007. Moreover, the California sulfur standard for diesel fuel does not include a temporary compliance option for highway diesel fuel or the small refiner and credit provisions included in the Federal program. Consequently, the California sulfur content standard for diesel fuel exceeds the requirements of the Federal ultra-low sulfur diesel program at 40 CFR 80.29.

California requires the use of ASTM standard D5186, a Supercritical Fluid Chromatography method, to measure the aromatic hydrocarbon content of diesel fuel. 13 CCR 2282(c). This method replaced ASTM D1319 which is a column chromatography method originally designed for use with gasoline. The replacement method, D5186, was developed for use with diesel fuels and is a more reliable measure of aromatic hydrocarbon content of diesel fuel. Consequently, this test method is an improvement over the past SIP-approved test method.

The State's compliance and enforcement program for diesel fuel is part of the fuels inspection program reviewed by EPA and found on December 21, 2005 to be sufficient to ensure that State standards for RFG would be met. Because the State's inspection program covers both RFG and diesel fuel, we make the same determination today for diesel fuel.

CARB's compliance and enforcement program for its diesel fuel program is the same as for California RFG. As stated above, we determined that the enforcement and compliance program for RFG was adequate in connection with our extension of our enforcement exemption to CaRFG3. Therefore, we are proposing to approve the State's revisions and amendments to its diesel fuel rules as meeting the requirements of CAA section 110(a). Moreover, because the submitted SIP revisions strengthen the approved SIP, EPA has determined that approval of these regulations is consistent with CAA section 110(l).

For the reasons discussed above, we are proposing to approve as revisions to the California SIP the California RFG regulations sold or supplied as motor vehicle fuel in California as submitted on June 15, 2004 and February 3, 2009. Additionally, we are proposing approval of the revisions to the diesel fuel regulations sold or supplied in California as submitted on February 3, 2009.

Under Executive Order 12866 (58 FR 51735, October 4, 1993), this proposed action is not a “significant regulatory action” and therefore is not subject to review by the Office of Management and Budget. For this reason, this action is also not subject to Executive Order 13211, “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use” (66 FR 28355, May 22, 2001). This action merely proposes to approve state law as meeting Federal requirements and imposes no additional requirements beyond those imposed by State law. Accordingly, the Administrator certifies that this proposed rule will not have a significant economic impact on a substantial number of small entities under the Regulatory Flexibility Act (5 U.S.C. 601et seq.). Because this action proposes to approve pre-existing requirements under state law and does not impose any additional enforceable duty beyond that required by state law, it does not contain any unfunded mandate or significantly or uniquely affect small governments, as described in the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4).

This proposed rule also does not have tribal implications because it will not have a substantial direct effect on one or more Indian tribes, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes, as specified by Executive Order 13175 (65 FR 67249, November 9, 2000). This proposed action also does not have Federalism implications because it does not have substantial direct effects on the States, on the relationship between the national government and the States, or on the distribution of power and responsibilities among the various levels of government, as specified in Executive Order 13132 (64 FR 43255, August 10, 1999). This proposed action merely proposes to approve a state rule implementing a Federal standard, and does not alter the relationship or the distribution of power and responsibilities established in the Clean Air Act. Executive Order 12898 establishes a Federal policy for incorporating environmental justice into Federal agency actions by directing agencies to identify and address, as appropriate, disproportionately high and adverse human health or environmental effects of their programs, policies, and activities on minority and low-income populations. Today's action involves proposed approvals of test methods for determining the aromatic hydrocarbon content in diesel fuel and the lowering of the maximum allowable sulfur content for motor vehicle diesel fuel in California; and corrects errors and streamline certain requirements for compliance and enforcement of the Phase III California RFG and update its predictive model to mitigate permeation emissions associated with the use of ethanol as a fuel additive. It will not have disproportionately high and adverse effects on any communities in the state, including minority and low-income communities.

This proposed rule also is not subject to Executive Order 13045 “Protection of Children from Environmental Health Risks and Safety Risks” (62 FR 19885, April 23, 1997), because it is not economically significant. The requirements of section 12(d) of the National Technology Transfer and Advancement Act of 1995 (15 U.S.C. 272 note) do not apply. This proposed rule does not impose an information collection burden under the provisions of the Paperwork Reduction Act of 1995 (44 U.S.C. 3501et seq.).

2. Section 211(c)(4)(A) prohibits States (and political subdivisions of states) from prescribing or attempting to enforce controls or prohibitions respecting any fuel characteristic or component if EPA has prescribed a control or prohibition applicable to such fuel characteristic or component under section 211(c)(1). This preemption applies to all states except California, as explained in section 211(c)(4)(B). Thus, the SIP approval and boutique fuels provisions of 211(c)(4)(C) do not apply here.

5.
See 55 FR 34120 (August 21, 1990). Specific CAA requirements for diesel fuel sulfur content are found in section 211(i). On August 21, 1990, EPA promulgated regulations pursuant to that section at 55 FR 34120. EPA subsequently established more stringent regulations for diesel sulfur content under the authority of section 211(c). See, e.g., the current regulations in 40 CFR part 86. 66 FR 5001 (January 18, 2001). Section 211(c)(4)(A) prohibits states (and political subdivisions of states) from prescribing or attempting to enforce controls or prohibitions respecting any fuel characteristic or component if EPA has prescribed a control or prohibition applicable to such fuel characteristic or component under section 211(c)(1). This preemption applies to all states except California, as explained in section 211(c)(4)(B). Thus, the SIP approval and boutique fuels provisions of 211(c)(4)(C) do not apply here.

10. See 70 FR 75914. The CaRFG3 regulations and related standards that are the subject of EPA's December 21, 2005 enforcement exemption represent the May 1, 2003 version of the California Reformulated Gasoline Regulations, 13 CCR 2250 et seq.

11. In the Energy Policy Act of 2005 (Energy Act), Congress removed the oxygen content requirement for RFG found in Section 211(k) of the CAA. The Energy Act made this change immediately effective in California, and 270 days after enactment for the rest of the country. We published a direct final rule to remove the oxygen content requirement for RFG for gasoline produced and sold for use in California, thereby making the fuels regulations consistent with amended Section 211(k)at 71 FR 8965 (February 22, 2006).

12. CARB's most recent annual enforcement report indicates that fuels inspection and enforcement cases are slightly higher now than when we approved the State's compliance and enforcement program in 2006. See “2007 Annual Enforcement Report” California Air Resources Board, May, 2008.